The Federal Reserve Bank of New York has published new research suggesting AI’s labour market impact has more to do with changing skill requirements than eliminating jobs — at least so far. The analysis, part of a new “Street Level” series by research director Kartik Athreya, draws on regional business surveys and job posting data to paint a more measured picture than the layoff headlines suggest.
🔍 THE BOTTOM LINE
The Fed data does not deny AI disruption. It reframes it. Firms are adopting AI rapidly, but they report very few AI-driven layoffs. Instead, they are reshaping hiring plans — reducing recruitment for some roles while increasing it for AI-proficient workers. The net effect is a skills shift, not a jobs apocalypse. And a new category of $200,000-plus roles is emerging to prove it.
What the Fed Found
The New York Fed analysis draws on several strands of research. The most striking finding comes from regional business surveys: firms overwhelmingly intend to retrain workers rather than fire them as they adopt AI.
AI adoption itself is accelerating. Among service firms surveyed, the share using AI rose from 25 per cent in 2024 to 40 per cent in 2025, with 44 per cent expecting to use it within six months. Manufacturers followed a similar trajectory, climbing from 16 per cent to 26 per cent to a projected 33 per cent.
But the hiring signal is nuanced. Some firms are reducing hiring because AI automates tasks. Others are increasing hiring for AI-proficient workers. The Fed frames this as a shift in skill requirements rather than a reduction in labour demand.
Athreya also references the “bundle of tasks” framework from economist Luis Garicano and coauthors: while some tasks will be taken over by AI, that transition opens the door for teams to work on other areas of production. “We need not assume, as some have speculated, that AI adoption will only spare jobs that focus on physical tasks and personal care,” Athreya wrote.
One commenter on the Fed post added a blue-collar dimension. RoadTrades, a job board for travelling skilled trades workers, noted that the AI buildout itself — data centres, substations, transmission — has been the loudest source of demand on their board for two years. “The workers most in demand are not using AI at all — they are building the facilities it runs in.”
The Challenger Counterpoint
The Fed’s measured tone sits alongside harder numbers from Challenger, Gray and Christmas. Employers have cited AI in 184,538 job cut announcements since 2023. In July 2026, AI led all stated reasons for the fifth consecutive month, with 10,970 cuts — 33 per cent of the monthly total. The 2026 tally reached 112,713, roughly 24 per cent of all cuts.
But even Challenger’s data carries a positive signal. July cuts fell to 33,429, the lowest monthly total in two years. Announced hiring plans rose 25 per cent year-to-date to 107,500. The story is not one-directional.
This aligns with our previous reporting on the Challenger July data showing AI layoffs in their fifth month but hiring rising. The labour market is bifurcating — not collapsing. It also echoes the AI layoff boomerang pattern we tracked earlier this year, where companies that cut workers for AI were rehiring them within months.
The New $200K Role
The skills shift the Fed describes is already producing new job categories. Forbes reported on August 24 that companies including Salesforce, Under Armour, UnitedHealth Group, and Medtronic are hiring for a role that did not exist before: AI workforce implementation leader.
The positions pay between $145,600 and $273,000 annually. Salesforce listed a senior manager role at up to $216,000. UnitedHealth Group’s remote senior director position reaches $273,000. Under Armour’s director of workforce architecture sits at $165,000 to $220,000.
These are not engineering roles. They sit at the intersection of HR strategy, organisational design, and AI deployment. The job descriptions require fluency in workforce transformation and AI — a combination that did not exist as a job title 18 months ago.
Separate DataCamp research cited by Forbes found AI and data job postings surged 80 per cent year-over-year, with AI engineering roles specifically leaping 255 per cent. The average AI engineer in the US earns $113,347, with some VC-backed startups offering up to $250,000.
The NZ Connection
The Fed’s retraining thesis maps directly onto New Zealand’s approach. Microsoft ANZ has committed to 300,000 AI training opportunities in New Zealand, as RNZ reported. SEEK’s AI Gauge shows demand for AI-related skills in NZ job ads has quadrupled over the past decade — though the absolute number of ads requiring AI skills remains relatively small.
The NZ labour market has not yet seen the large-scale AI-driven layoffs reported in the US. Whether that reflects slower AI adoption, different industry mix, or simply a lag effect is not yet clear. But the Fed’s data — firms retraining rather than firing — suggests NZ’s investment-first approach may be aligned with what large employers are actually doing globally.
❓ FAQ
Is the New York Fed saying AI is not costing jobs? No. The Fed acknowledges firms anticipate reducing hiring plans, especially for college-educated workers. But survey data shows firms report very few AI-driven layoffs so far, and overwhelmingly plan to retrain rather than fire. The distinction is between reducing future hiring and eliminating existing positions.
What is the new $200K AI job? Companies are hiring “AI workforce implementation leaders” — roles that combine HR strategy, organisational design, and AI fluency. They are responsible for deciding how AI is integrated into work, which tasks are automated, and how workers are redeployed. Salaries range from $145K to $273K.
How many AI jobs have been created versus cut? DataCamp found AI and data job postings surged 80 per cent year-over-year. AI engineering roles specifically grew 255 per cent. On the cuts side, Challenger reports 112,713 AI-cited job cuts in 2026 through July. Both numbers are real — the market is churning, not just shrinking.
What does this mean for New Zealand? NZ has invested heavily in AI reskilling (300,000 Microsoft training opportunities) and has not yet seen US-scale AI layoffs. The Fed’s retraining thesis suggests this approach may match what employers globally are actually doing — though the lag question remains open.
🔍 THE BOTTOM LINE
The Fed’s data is a useful corrective to the dominant narrative, but it is not a victory lap. Firms are retraining rather than firing — for now. The same surveys show firms anticipate reducing hiring for college-educated workers going forward. The new $200K roles prove that AI is creating jobs as well as displacing them, but those jobs require a rare combination of skills that most workers do not yet have. The honest read is that we are in a transition, not an ending — and the evidence for both sides is real.
📰 Sources
- Federal Reserve Bank of New York — AI’s Impact on Labor and Hiring
- Forbes — Salesforce and others are hiring for this new $200,000+ AI job
- Forbes — The AI job that surged 255% in 2026 and pays $113,000
- Yahoo Finance — Bill Gates wants up to 40% of jobs reserved for humans, not AI (Challenger data)
— CJ Murden, editor of Singularity.Kiwi. Former digital technologies teacher, author of AI-focused books. Writing with a New Zealand focus.
